Insight

Royalty increase would be another blow for Indonesian coal mines

This report is currently unavailable

Further information

Contact us

Submit your details to receive further information about this report.

  • An error has occurred while getting captcha image

Report summary

The Indonesian government is considering hiking royalties for IUP mines from 3-7% of revenue to 13.5%. We expect such an increase will raise cash costs by 9% and wipe out 20% of value from IUP mines.  PTBA would be the worst affected of Indonesia's major producers with the value of the company's coal mines expected to decrease by more than US$1 billion. Ironically, PTBA is 65% owned by the Indonesian government. The rationale for increasing royalties is to boost government revenue from the...

What's included

This report contains

  • Document

    Royalty increase would be another blow for Indonesian coal mines

    PDF 434.75 KB

Table of contents

  • Executive summary
  • Government considering IUP royalty increase to 13.5%
  • Impact on Indonesian mines
  • Impact on companies
  • Impact on government revenue
  • Rationale and consequences
  • Economic assumptions

Tables and charts

This report includes 4 images and tables including:

Images

  • Change in coal portfolio valuations for IDX listed companies if IUP royalties increase to 13.5%
  • Total government take from Indonesia's coal industry

Tables

  • Possible royalty change
  • Impacts of possible royalty change

Questions about this report?

    • Europe:
      +44 131 243 4699
    • Americas:
      +1 713 470 1900
    • Asia Pacific:
      +61 2 8224 8898